This week's key events include the US July CPI data release, the Reserve Bank of Australia's interest rate decision, and monthly oil market reports from OPEC, the IEA, and the EIA.

On Wednesday, August 11th at 20:30, the US Department of Labor will release the July unadjusted year-on-year CPI data. The market expects a reading of 3.4%, a 0.1 percentage point decrease from the previous month. The month-on-month CPI is expected to be 0.1%, up from the prior -0.4%. Based on these expectations, US consumer prices may show a medium-term decline in July, though short-term prices could see a rebound.

The chart shows that the US month-on-month CPI (purple line) is more volatile and range-bound compared to the year-on-year data (gray line). The core year-on-year CPI (blue line) closely tracks the overall year-on-year CPI. For the Federal Reserve, the core CPI, which excludes food and energy, is more instructive. The market expects core CPI to be 2.5%, down 0.1 percentage points from the previous month.

The Fed's inflation target is 2%. The market expectation of 2.5% for core CPI is 0.5 percentage points above this target, providing a theoretical basis for the Fed to raise interest rates to curb inflation. If the actual release on Wednesday exceeds expectations, the likelihood of a Fed rate hike will increase, which would be bullish for the US dollar index.

On Tuesday at 12:30, the Reserve Bank of Australia will announce its August interest rate decision. The consensus expectation is that it will keep the benchmark rate unchanged at 4.35%. The probability of a fourth rate hike this year is low, as Australia's inflation has shown signs of retreating from its peak. At 13:30, RBA Governor Michele Bullock will hold a press conference on monetary policy. The focus will be on her views on the interest rate path and the inflation outlook. If she hints at a hawkish stance on tightening policy, the Australian dollar could be boosted.

Australia's quarterly year-on-year CPI (blue line in the chart) is a reliable leading indicator for the RBA's rate decisions. For instance, when CPI began to decline in the first half of 2020, the RBA subsequently started a rate-cutting cycle. Inflation peaked in the fourth quarter of 2022, and the RBA paused rate hikes in November 2023. Since the second quarter of 2025, Australia's inflation rate has stopped falling and rebounded, prompting the RBA to start a new rate hike cycle, with three cumulative hikes totaling 75 basis points. In the second quarter of this year, Australia's annual CPI fell from 4.1% to 3.9%, suggesting that the rate hikes are curbing inflation. Therefore, the RBA is likely to hold steady at its upcoming meeting to observe further inflation developments.

On Wednesday, the EIA will release its monthly Short-Term Energy Outlook at 00:00. The IEA will publish its monthly oil market report at 16:00. At an unspecified time, OPEC will release its monthly oil market report. Based on past experience, the OPEC report is usually released between 18:00 and 21:00. All three organizations hold unique data not available to others, and their reports have different biases. Together, they provide a comprehensive view of the current international energy market's supply and demand dynamics.

The key to interpreting these reports is to focus on supply and demand expectations. In the July reports, the EIA expected oil demand to decrease by 1 million barrels per day in 2026, the IEA expected a decrease of 1.2 million barrels per day, while OPEC expected demand to increase by 780,000 barrels per day. Given OPEC's role in global oil production and sales, its report is naturally more bullish on demand. On the supply side, the previous IEA report forecasted a supply increase of 4.1 million barrels per day to 98.8 million barrels per day. The EIA forecasted an increase of 3.98 million barrels per day to 97.46 million barrels per day. OPEC expected an increase of about 3 million barrels per day to 36.28 million barrels per day. OPEC's weakest forecast for supply growth is consistent with its identity as a group of oil-producing nations.